Sony Ravindranth-Waddell of the Richmond Federal Reserve, shared data on the economic conditions of the New River Valley at last Thursday’s Eggs and Issues, a monthly event of the Montgomery County Chamber of Commerce.
Sony Ravindranth-Waddell of the Richmond Federal Reserve shared data on the economic conditions of the New River Valley.
Waddell is the Director of the Regional Economics Research Department of the Richmond Federal Reserve Bank.
She provided data and relevant stories to illustrate the economic trends of municipalities in Blacksburg, Radford and the surrounding areas.
Economic growth in the New River Valley has been trailing the United States and Virginia with only 0.4 percent progress in 2018 so far.
This is lower than the heavily populated Virginia regions that saw a high of 4.8 percent in Charlottesville, 2.7 percent in Winchester and 1.8 percent growth in northern Virginia.
Overall, the state grew faster than the national average of 1.6 percent. The New River Valley was strong in goods production by 4.4 percent. Government spending declined by 2.3 percent.
Our area’s unemployment rate is 3.3 percent while the U.S. showed 3.9 percent and Virginia had a 3.1 percent average in July 2018.
Unemployment in the area, while the lowest since the 2009 recession, was examined as a major factor in slower recovery than the rest of the U.S. Average hourly earnings have been slow to increase at only 2.7 percent.
Employers are having a tough time finding and keeping skilled workers.
“Wages alone are not attracting or keeping workers,” said Waddell.
There is no data, just stories, to demonstrate those conclusions: generous family leave, healthcare, and other benefits.
Waddell said. “One business may offer recreational space for employees. One business even offers beer-cart Fridays. These do not show up in our wage data.”
She said that since millennials grew up performing services to the community, corporate citizenship motivates employees’ loyalty more so than in the past.
At the same time, business surveys tell stories of less skilled workers not wanting to learn new skills or workers not being motivated.
Service, trucking and construction jobs are increasing but are having great difficulty finding workers.
Without construction labor, along with decreased building supplies and fewer available lots, single and multiple family home construction is also declining and have yet to recover to 1990 levels.
Inventory of single-family homes are low, thus existing home prices are rising. Middle level homes under $400,000 are in short supply.
Forecasting the future economic trends of the U.S., Virginia and the New River Valley is uncertain because of congress and tariffs. Bonuses from tax cuts and reduced regulations have helped.
Businesses are being cautious. However, economic growth in the U.S. continues to be solid. Waddell predicted steady, slow growth for the foreseeable 1-2 years, and cautioned that anyone offering a prediction beyond 10 years simply has no solid basis.
The next Eggs and Issues breakfast is scheduled for Thursday, October 4. The Montgomery Chamber’s featured speaker will be Chris Beam, President and CEO of Appalachian Power discussing The Future of Energy.
Details and registration are available at the Chamber’s website: MontgomeryCC.org.
